Ethics is more than simply the pursuit of goods; is also about fidelity to ethically acceptable relationships. A crucial relationship is that of a professional towards his or her client. Because accounting is a skill that demands expertise, and because accountants have clients’ who depend on that expertise, accounting can be included among the professions. Accounting ethics in the field of accounting refers to the guidelines (consisting of judgments and moral values) that a professional needs to follow while practicing accounting. People using the service of accounting professionals rely on their professional competency to take decisions and in the process also relies on the ethics followed ...view middle of the document...
It is due to the above roles that the accounting professionals developed a code of conduct that all accounting professionals need to follow. The essence of the ethics lies in its use. The code of conduct or ethics entails an accounting professional to adhere to high degrees of self discipline which even goes falls beyond the legal precincts. Whenever an accounting professional becomes a member of organizations like IMA, IIA and CIA, they are directed to follow the code of conduct and ethics.
Factors influencing ethics
• Creative Accounting- is an accounting practice which takes advantage of the gaps in accounting rules and principles to misrepresent the financial position and performance of a company (Shah 1998). Creative accounting does not necessarily break any accounting rules but as Shah (1998) suggests, it goes against the spirit of accounting principles and rules. Creative accounting is practiced for various reasons such as, to increase employee and management bonus and to boost a company’s share price (Clikeman et al. 2000).
Thus if performance is linked to accounting figures those responsible for preparing the accounts will be tempted to manipulate the figures increase their rewards. Organizations have been criticized for encouraging unethical behaviour, due performance measurements criteria. It is thought that managers and employees should be rewarded for ethical behaviour rather than financial results which can lead to the manipulation of accounting figures to meet targets. Creative accounting impairs the integrity of accountants and opposes the IFAC Code of Ethics which requires accountants to be straightforward in carrying out their duties (IFAC 2008).
• Gender- differences in ethical decision making have been of interest to numerous researchers, with research focusing on ethical judgment, behaviour, intent and awareness (O’Fallon and Butterfield 2005). In the recent review of recent literature on ethical decision making, the researchers found females are more ethical than males. O’Leary and Radich (2002) also concluded that there is a significant gender difference in the ethical attitudes. Their findings revealed men were almost four times more likely than women to accept bribes. This view of gender differences is also supported by Glover et al. (2002) who used a laboratory format with a decision exercise to examine business students’ workplace values, the results show that women had more ethical concerns than men regardless of the situation.
• Age-Experience may influence ethical behaviour, as individuals face more ethical dilemmas they should be better prepared to respond in the future if they can learn from the past. More experienced professionals are likely to make better moral decisions than less experienced professionals, this may indicate that age affects ethical views (O’Leary and Stewart 2007).
• Culture and Risk-Su (2006) concluded that ethical perception in business practices is influenced by cultural...